How to Get Out of Debt

How to get out of debt

With the average UK household now owing £12,887 not including mortgages, there’s never been a better time to address your debt.

It can be difficult to manage some of life’s bigger expenses without taking on debt. Getting a new car or doing home improvements can be unaffordable for some without some form of loan or credit.

But, when you find yourself borrowing more money than you can afford to repay, it’s time to address your finances before your debts spiral out of control.

It’s important not to panic. And thankfully, Ferratum are here to share some effective ways of managing debt, before you’re in trouble.

Re-evaluate your finances

Don’t be afraid of sitting down and assessing your incomings and outgoings and setting a realistic budget.

Print off your bank statements and highlight all the outgoings do you still need that music service subscription? Has your TV package crept up in cost without you realising? It’s easy to leave open payments set up to subscription services you’re no longer using, and many of them can be cancelled straight away – instant savings!

Plan ahead, shop smart

Instead of just picking up what you fancy in the supermarket, plan your meals in advance and make a shopping list so you’ll have all the ingredients. Meal planning is a great way to make sure you don’t end up with waste at the end of the week. And, if you’re guilty of impulse buys when you’re shopping, consider doing it online. Less temptation means you stick to your list!

Plan ahead for birthdays and Christmas. Buy presents throughout the year to spread the cost, you’ll thank yourself in December!

Get a part-time job and sell what you don’t need

One of the best ways to get rid of debt fast is to pick up some extra income from a temporary part-time job. This means you don’t need to find extra money from your stretched budget.

Having a clear out and selling some of your old things is another great way to pick up some extra cash. There are so many options for selling locally through Facebook or selling sites. But, be sensible. Don’t try and sell millions of items for £1. Bundle items together, and have a look on eBay or other selling sites for a realistic price for your item. Children’s toys often have great resale value, especially in the run up to Christmas.

Consider talking to an expert

If you feel like you don’t have a good head for numbers, or you’re struggling with budget, consider talking to someone who knows what they’re doing. This doesn’t have to be a professional accountant, but maybe a friend or family member with experience or who is good at managing their own budget. Try asking for some guidance and advice to get you started.

It’s easier than you think to get started on the journey to being debt free. Do you have any tips to share with the community? Head over to Facebook and let us know. 

Warning: Late repayment can cause you serious money problems. For help, go to moneyadviceservice.org.uk. Representative example: APR 1270% if borrowing £400 for 4 months. Interest rate: 292% p.a. (fixed). Total amount repayable: £665.48 by four instalments of £166.37. Maximum representative APR: 1604% if full loan repaid after 7 days.